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DETROIT: 24 June 2016 — New-vehicle retail sales in June are expected to reach 1,206,700 units, a 0.5% decline from a year ago on a selling-day adjusted basis, according to a monthly sales forecast developed jointly by J.D. Power and LMC Automotive.

Retail sales through the first half of 2016 are projected to reach 6.8 million units, down 0.2% from the same period in 2015. With the sales slowdown expected to continue in the second half of the year, LMC Automotive is reducing its retail light-vehicle sales forecast for the year to 14.2 million units from 14.3 million units.

  • The seasonally adjusted annualized rate (SAAR) for retail sales in June 2016 is projected to reach 13.3 million units, down from 13.5 million units in June 2015.
  • New-vehicle retail transaction prices thus far in June are at an all-time high for the month at $31,089. The previous record was $30,202, set in June 2015. Incentives are also at a record high for the month of June at $3,278 per vehicle, $119 per vehicle more than the previous high in June 2015.
  • With record transaction prices, consumers are on pace to spend $37.5 billion on new vehicles in June, surpassing the record high of $35.2 billion for the month of June, set in 2015. 
  • Increased fleet sales are expected to off-set slower retail sales, increasing total light-vehicle sales in June to 1,546,800, a 0.8% increase on a selling-day adjusted basis from 1,475,062 a year ago. Fleet sales are expected to hit 340,000, a 5.9% increase from 308,640 in June 2015 on a selling-day adjusted basis.
  • The SAAR for total sales is projected at 17.0 million units in June 2016, the same level as a year ago.
  • The lower level of retail sales has had an impact on the total light-vehicle market. LMC Automotive is maintaining its full-year forecast at 17.7 million, but cautions that volume may be at risk, as rising fleet sales may not be enough to maintain total volume.

J.D. Power and LMC Automotive U.S. Sales and SAAR Comparisons

 

June 20161

May 2016

June 2015

New-Vehicle Retail Sales

1,206,700 units

(0.5% lower than June 2015)2

1,207,853 units

1,166,422 units

Total Vehicle Sales

1,546,800 units

(0.8% higher than June 2015)2

1,535,331 units

1,475,062 units

Retail SAAR

13.3 million units

13.7 million units

13.5 million units

Total SAAR

17.0 million units

17.4 million units

17.0 million units

1Figures cited for June 2016 are forecasted based on the first 16 selling days of the month.

2The percentage change is adjusted based on the number of selling days in the month (26 days in June 2016 vs. 25 days in June 2015).

John Humphrey, senior vice president of the global automotive practice at J.D. Power, said: “We have seen a slowdown in retail demand since April, posing a significant challenge to manufacturers on a volume basis. Despite sales slowing down, consumer spending remains at record levels due in large part to a continued shift from cars to trucks. The key going forward will be to what degree automakers are able to adjust production levels to slowing demand rather than relying on profit-damaging incentives to move inventory. This will be something to watch as the industry is nearing what is close to being the peak of an average cycle.”

Jeff Schuster, senior vice president of forecasting at LMC Automotive, said: “Year-over-year growth is evaporating, and while we are now expecting a slight contraction in retail sales, the total light-vehicle market should remain 1% higher than 2015. However, risks continue to mount for the second half of 2016, with 200,000-300,000 units of volume risk. If the selling rate averages 17.5 million units, which is higher than the projected 17.1 million-unit pace in the first half of the year, total sales for the year will end at 17.4 million units, or a decline of 0.3% from 2015.”

U.S. Retail SAAR—June 2015 to June 2016

(in millions of units)

Source: Power Information Network® (PIN) from J.D. Power

See the online press release at http://www.jdpower.com/press-releases/jd-power-and-lmc-automotive-forecast-june-2016

About J.D. Power and Advertising/Promotional Rules www.jdpower.com/about-us/press-release-info

About LMC Automotive www.lmc-auto.com

Media Relations Contacts

John Tews; J.D. Power; Troy, Mich.; 248-680-6218; media.relations@jdpa.com

Emmie Littlejohn; LMC Automotive; Troy, Mich.; 248-817-2100; elittlejohn@lmc-auto.com

No advertising or other promotional use can be made of the information in this release without the express prior written consent of J.D. Power or LMC Automotive. www.jdpower.com/corporate  www.lmc-auto.com

Media Contacts:

John Tews

Troy, Michigan

(248) 680-6218

media.relations@jdpa.com